When thinking about those important lessons you must pass on to your children, parents don't often consider money management skills. But lessons about the value of a dollar, saving and investing shouldn't be left to chance. Children's attitudes about money develop early in life, which is why the conversation about money should start at an early age.
Teaching the value of money doesn't have to be a daunting task; these tips will help you get the wheels of saving and investing turning in your child's mind.
1. Use everyday life to talk about money. When you're paying for groceries with your debit card or paying a bill online, explain to your kids what you're doing and how the process works.
2. Introduce an allowance. An allowance is a great way to show children the value of a dollar, and it teaches basic budgeting and money management skills. Suggest that they put aside a portion of their allowance for savings. When it's time to move those savings from the piggy bank, consider opening a savings account for your child, like the children's savings account from ING Direct which you can open together online.
3. Make money management fun. Websites, like Planet Orange, give kids a chance to discover the importance and value of money, along with other personal finance lessons, through fun and engaging games and activities. (www.planetorange.ca)
4. Involve your kids in the family finances. Sit down with your kids and show them the family budget. Explain the various expenses, like mortgage payments and groceries, show them how much is set aside for savings and retirement, and explain the importance of putting aside money for family vacations and big ticket purchases.
